This promise was never delivered in the developing world. Subsequently, the greed of dominant economic interests has, in large part, undermined the promise of globalization itself, creating a failed economic model. The breakdown of the social contract, where it existed, began in the 1980s. The inadequacy of a development model for the majority of the world’s people has resulted in today’s fractured world.
A new social contract is vital for a fair competition floor. Its foundations are full employment and decent work, in a world where our dominant model of trade relies on low-wage, often unsafe work, with insecure employment contracts. Decent work is still absent in too many countries for too many people, but its underlying principles remain unchanged. These are:
These principles need once again to be enshrined in a social contract. This would renew commitment to vital public services and full employment, and would require investment in jobs, beginning in sustainable infrastructure and the care economy.
Unions demand that nobody be left behind, with measures to ensure a “just transition” to a low-carbon, high-tech economy. These involve guaranteed pensions for older workers, income support, redeployment support and access to retraining. Lifelong learning is central, as technology impacts on workers’ tasks and creates a continuous need to upgrade skills.
Global GDP has trebled since 1980, yet the share of wealth that people get for their work has declined. Investment in infrastructure, care work and the green economy is inadequate. Global governance should be up to the task of global reform, beginning with a new social contract. However, it still contests that ‘trickle-down’ economic theory, and more recently austerity, have failed.
Global inequality is now an economic risk. It is caused by global trade and investment rules that have favoured finance and capital in developed economies. Global supply chains channel wealth to a handful of global corporations, while workers in those supply chains experience low wages, and insecure and often unsafe work.
A war against unions and freedom of association is being waged, and democracy is being corrupted by concentrated wealth. Too many corporations and their associations are buying or bullying legislators and executive branch officials to influence public policy, to the detriment of working people and the very foundations of a stable and sustainable future.
When the vested interests of the few have been afforded preference over the interests of the great majority; when naked self-interest has been dressed up as modern economic models to justify why wealth is not being shared; when natural resources are being exploited unsustainably; when corporations and the wealthy pay little or no tax; and when there is a severe lack of resources for social protection including health and education, it’s clear that the model must change.
In addition to these challenges and the consequent vulnerability of the global economy, the potential for an even more unequal world is emerging with waves of new technology. There are major deficits in the regulatory environment for ensuring decent work through internet-mediated platforms and algorithms. There is also scant investment in new jobs to mitigate the displacement of workers in the face of the future of production.
Job anxiety
Global polling by the International Trade Union Confederation (ITUC) shows that the majority of people are not worried about new technology, but they are deeply anxious about their jobs. Digitalization has given rise to new business models founded on the expectation that workers will further have to give up employment contracts and social security, and forget the notion of a regular working schedule where work, family and leisure can be balanced.